Maintained for Historical Purposes

This resource is being maintained for historical purposes only and is not currently applicable.

(General) Subject: Federal Pell Grant Restoration for Students Who Attended Closed Schools

Posted Date:December 21, 2016

Author: Jeff Baker, Director, Policy Liaison and Implementation, Federal Student Aid

Subject: Federal Pell Grant Restoration for Students Who Attended Closed Schools

This Electronic Announcement provides information on the Department’s plan to recalculate and restore Federal Pell Grant eligibility for students who received a Pell Grant at a now-closed school. It provides information about eligibility for restoration and the modifications we will make to our systems (e.g., COD, NSLDS, and CPS) to restore and report such students’ Pell Grant eligibility.

Following a number of recent cases of closed schools, the Department has determined it has the authority to restore semesters of Pell Grant eligibility for Pell Grant recipients who were unable to complete their course of study due to the closing of a school. Eligible students will include those Pell Grant recipients who were enrolled during either the award year in which the school closed or during the immediately prior award year, and who did not complete their course of study at that school. The policy will restore eligibility equivalent to all of the semesters that an eligible student attended the school that closed.

A student’s eligibility to receive a Pell Grant is limited by a statutory provision that sets a Pell Grant lifetime eligibility limit of 12 semesters (or its equivalent). In addition, for each award year, a student may not receive more than 100 percent of his or her Pell Grant Scheduled Award. Institutions should review previously posted information on Pell Grant eligibility determinations and the Lifetime Eligibility Used (LEU) limit in Dear Colleague Letter GEN-13-14 and Volume 3, Chapter 3 of the Federal Student Aid Handbook.

We have begun the work needed to modify our systems to implement the restoration of Pell Grant eligibility for students who received Pell Grant funds for attendance at a now closed school. We expect to complete the first phase of that work by this coming March. At that time, our systems will monitor Pell LEU and adjusted eligibility will be displayed in both NSLDS and in the COD system, including the Pell Grant reports that the Department provides through the COD System.

Once the first phase of work is complete, the Department will conduct outreach to affected students. In addition, for those students who filed a 2016-2017 or 2017-2018 FAFSA, NSLDS postscreening will produce a new SAR and ISIR if the Pell Grant restoration adjustment will change the student’s possible Pell Grant eligibility. This will, in most instances, allow the institution to correctly award students their full Pell Grant eligibility.

In the coming weeks, we will post important information for schools to address situations where some or all of a student’s 2016-2017 annual Pell Grant eligibility has been reduced due to the student having received 2016-2017 Pell Grant funds from a school that subsequently closed.

We thank the financial aid community for their patience as we work to ensure that students eligible for a Federal Pell Grant receive the funds for which they are entitled so they can successfully complete their postsecondary education.

If you have any policy questions, please contact our Research and Customer Care Center (Care Center) staff at 1-800-433-7327. Staff members are available Monday through Friday between the hours of 9:00 AM and 5:00 PM (Eastern Time). After hours calls will be accepted by an automated voice response system. Callers leaving their names and phone numbers will receive a return call within two business days. Alternatively, you may e-mail the Care Center at

If you have COD system related issues, you may contact the COD School Relations Center at 1-800-474-7268 for Pell Grants. You may also e-mail

Last Modified: 12/20/2016