(GRANTS-24-05) COD System Calculation of the Federal Pell Grant Scheduled Award Based on FAFSA Simplification Act Changes

Posted Date
April 15, 2024
Author
Federal Student Aid
Electronic Announcement ID
GRANTS-24-05
Subject
COD System Calculation of the Federal Pell Grant Scheduled Award Based on FAFSA Simplification Act Changes

The FAFSA Simplification Act (Act) was enacted into law as part of the Consolidated Appropriations Act, 2021, and amended by the Consolidated Appropriations Act, 2022. The Act further amends the Higher Education Act of 1965, as amended (HEA), and impacts the Free Application for Federal Student Aid (FAFSA®). As a result of the changes in the Act, the 2024–25 Pell Grant Scheduled Award (Scheduled Award) calculation is now formulaic. On April 21, 2024, we will make significant system changes to the Common Origination and Disbursement (COD) System to align with the new Pell Grant award calculation.

The Aug. 4, 2023 Dear Colleague Letter, FAFSA Simplification Act Changes for Implementation in 2024–25, posted on the Knowledge Center, detailed changes impacting the Scheduled Award beginning with the 2024–25 award year. While the Act alters how the Scheduled Award is determined, the Scheduled Award is still defined as the maximum Pell Grant award based on full-time enrollment for the award year. Some notable changes include:

  • Federal Pell Grant Payment and Disbursement Schedules will be retired with the 2023–24 award year.

  • The Expected Family Contribution (EFC) will be retired. Instead, the Student Aid Index (SAI) will be calculated for 2024–25 and forward.

  • The separately funded Iraq and Afghanistan Service Grant (IASG) will be retired with the 2023–24 award year. Eligibility changes to the IASG and Children of Fallen Heroes (CFH) programs have aligned under the Special Rule provision in the HEA Section 401(c) and make both IASG and CFH students eligible for the maximum Pell Grant, regardless of Student Aid Index (SAI) for the 2024–25 award year and forward. The Children of Fallen Heroes Indicator will continue to track certified eligibility, and the Iraq Afghanistan Service Grant Indicator will be added to mirror that same process.

  • The new Max Pell and Minimum Pell Indicators will assist in determining the recipient’s Scheduled Award.

  • New rounding rules will apply to ensure the Scheduled Award is an increment of $5, with low Cost of Attendance (COA) exceptions. The published minimum and maximum Pell Grant amounts will always be an increment of $5.

  • The half-time enrollment restriction will be removed for the 2024–25 award year and forward with no other changes to the Year-Round Pell provision.

Detailed information about manually calculating an SAI and determining Pell Grant eligibility is found in the 2024–25 Student Aid Index (SAI) and Pell Grant Eligibility Guide.

The COD System will continue to calculate a Scheduled Award based on processed Institutional Student Information Record (ISIR) and the submission of school COA data. The COD System relies on the FAFSA Processing System’s (FPS) Pell Grant eligibility determinations (e.g., Pell Eligible flag, new Pell Max/Minimum indicators, etc.) to calculate the Scheduled Award. Having these initial eligibility determinations completed by the FPS removes or alters some of the steps outlined in the 2024–25 Student Aid Index (SAI) and Pell Grant Eligibility Guide and abbreviates the COD System’s Scheduled Award process flow.  

How the COD System Calculates a Scheduled Award

Beginning with the 2024–25 award year the COD system will calculate a Scheduled Award if the minimum data elements are available. The minimum elements required from the specified FPS Transaction number are as follows:

  • Student Aid Index (SAI)

  • Pell Eligibility Flag equal to “Yes”

  • Cost of Attendance (COA)

The COD system will then complete the calculation process using the minimum data elements in addition to the Max Pell, Minimum Pell, Iraq Afghanistan Service Grant (IASG), and Children of Fallen Heroes (CFH) indicators in the following order:

STEP 1: Is there a Max Pell Indicator equal to null (blank)?

  1. If yes, there is no value in the Max Pell Indicator, then the COD System goes to STEP 2.

  2. If no, there is a valid value in the Max Pell Indicator, then the COD System goes to STEP 5.

STEP 2: Is the SAI less than or equal to zero?

  1. If yes, the SAI is less than or equal to zero, then the COD System goes to STEP 5.

  2. If no, the SAI is greater than zero, then the COD System proceeds to STEP 3.

STEP 3: Regardless of SAI, is the Iraq Afghanistan Service Grant Indicator "Eligible for IASG" or "Eligible Due to Grandfathering"?

  1. If yes, the Iraq Afghanistan Service Grant Indicator has an eligible value, then the COD System proceeds to STEP 5.

  2. If no, the Iraq Afghanistan Service Grant Indicator has a value of “Not Eligible for IASG” or is blank, then the COD System proceeds to STEP 4.

STEP 4: Regardless of SAI, is the Children of Fallen Heroes Indicator "Eligible for CFH" or "Eligible Due to Grandfathering"?

  1. If yes, the Children of Fallen Heroes Indicator has an eligible value, then the COD System proceeds to STEP 5.

  2. If no, the Children of Fallen Heroes Indicator has a value of “Not Eligible for CFH” or is blank, then the COD Systems proceeds to STEP 6.

STEP 5: Does the COA exceed the maximum published Pell Grant?

  1. If yes, the Scheduled Award equals the maximum published Pell Grant, and the calculation ends.

  2. If no, then the Scheduled Award equals the COA with cents truncated, no rounding takes place, and the calculation is complete.

STEP 6: Is the Minimum Pell Indicator equal to null?

  1. If yes, the COD System calculates a “Temporary Scheduled Award” (TSA) by subtracting the SAI from the maximum published Pell Grant amount and proceeds to STEP 7.

  2. If no, then the COD System proceeds to STEP 9.

STEP 7: [Rounding Rules] Does the TSA end in 0 or 5?

  1. If yes, the COD system proceeds to STEP 8.

  2. If no, and the TSA end in 3, 4, 8 or 9, the COD System rounds the TSA up to the nearest $5 increment and proceeds to STEP 8.

  3. If no, and the TSA ends in 1, 2, 6 or 7, the COD System rounds the TSA down to the nearest $5 increment and proceeds to STEP 8.

STEP 8: Is the TSA greater than COA?

  1. If yes, the Scheduled Award equals the COA with any cents truncated, no rounding takes place, and the calculation is complete.

  2. If no, the Scheduled Award equals the TSA, and the calculation is complete.

STEP 9: Does the COA exceed the minimum published Pell?

  1. If yes, the Scheduled Award equals the published minimum Pell Grant, and the calculation is complete.

  2. If no, the Scheduled Award equals the COA with any cents truncated, no rounding takes place, and the calculation is complete.

COD System Processing Rules for Scheduled Award Remain Unchanged

While the overall calculation of the Scheduled Award has changed, the business rules for how the COD System utilizes the Scheduled Award in its processing are generally unchanged.

The COD System will continue to

  • Use the Scheduled Award to calculate the annual and lifetime eligibility used percentages.

  • Evaluate the calculation of the Scheduled Award using all current COD System edits.

  • Return the Scheduled Award in response files.

  • Display the Scheduled Award throughout the COD website.

Additional Resources

2024–2025 COD Technical Reference: Volume 2 – Implementation Guide

2024–25 FAFSA® Specifications Guide

As a reminder, the COD System will implement the changes for calculating the Scheduled Award on April 21, 2024. Information about other changes implemented in the COD System at the same time will be explained in a separate forthcoming Electronic Announcement.

Contact Information

For questions about Pell Grant awards, contact the FSA Partner and School Relations Center at 1-800-848-0978. You may also email CODSupport@ed.gov.